EXHIBIT 1.3
FIRST HORIZON ASSET SECURITIES INC.
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2005-AA10
TERMS AGREEMENT
(to Underwriting Agreement,
dated November 20, 2003
between the Company and the Underwriter)
First Horizon Asset Securities Inc. Xxxxxxx, Xxxxxxxxx
0000 Horizon Way October 24, 2005
Xxxxxx, Xxxxx 00000
FTN Financial Capital Markets, a division of First Tennessee Bank National
Association (the "Underwriter") agrees, subject to the terms and provisions
herein and of the captioned Underwriting Agreement (the "Underwriting
Agreement"), to purchase such Classes of First Horizon Alternative Mortgage
Securities Trust, Series 2005-AA10 Certificates specified in Section 2(a) hereof
(the "Offered Certificates"). This letter supplements and modifies the
Underwriting Agreement solely as it relates to the purchase and sale of the
Offered Certificates described below. The Series 2005-AA10 Certificates are
registered with the Securities and Exchange Commission by means of an effective
Registration Statement (No. 333-125158). Capitalized terms used and not defined
herein have the meanings given them in the Underwriting Agreement.
Section 1. The Mortgage Pools: The Series 2005-AA10 Certificates shall
evidence the entire beneficial ownership interest in two pools (the "Mortgage
Pools") of primarily 30-year adjustable rate, first lien, fully amortizing,
one-to-four family residential mortgage loans (the "Mortgage Loans") having the
following characteristics as of October 1, 2005 (the "Cut-off Date"):
(a) Aggregate Principal Amount of the Mortgage Pools: Approximately
$315,016,725 aggregate principal balance as of the Cut-off Date, subject
to an upward or downward variance of up to 5%, the precise aggregate
principal balance to be determined by the Company.
(b) Original Term to Maturity: The original term to maturity of each
Mortgage Loan included in Pool I and Pool II shall be 360 months.
Section 2. The Certificates: The Offered Certificates shall be issued as
follows:
(a) Classes: The Offered Certificates shall be issued with the
following Class designations, interest rates and principal balances,
subject in the aggregate to the variance referred to in Section 1(a) and,
as to any particular Class, to an upward or downward variance of up to 5%:
Class Principal Interest Class Purchase
Class Balance Rate Price Percentage
----- ---------------- ----------- ----------------
I-A-1 $ 140,430,000.00 Variable(1) 101.156250000%
I-A-2 $ 423,000.00 Variable(1) 101.156250000%
I-A-R $ 100.00 Variable(1) 101.156250000%
II-A-1 $ 153,687,000.00 Variable(1) 101.156250000%
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(1) The interest rates for the Offered Certificates are variable and will be
calculated as described in the Prospectus Supplement.
(b) The Offered Certificates shall have such other characteristics
as described in the related Prospectus.
Section 3. Purchase Price: The Purchase Price for each Class of the
Offered Certificates shall be the Class Purchase Price Percentage therefor (as
set forth in Section 2(a) above) of the initial Class Principal Balance thereof
plus accrued interest at the per annum initial interest rate applicable thereto
from and including the Cut-off Date up to, but not including, October 28, 2005
(the "Closing Date").
Section 4. Required Ratings: The Offered Certificates (other than the
Class I-A-2 Certificates) shall have received Required Ratings of at least "AAA"
from Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc. ("S&P")
and "Aaa" from Xxxxx'x Investors Service, Inc. ("Moody's"). The Class I-A-2
Certificates shall have received Required Ratings of at least "AAA" from S&P and
"Aa1" from Moody's.
Section 5. Tax Treatment: One or more elections will be made to treat the
assets of the Trust Fund as a REMIC.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the undersigned a counterpart hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between the Underwriter and the Company.
Very truly yours,
FTN FINANCIAL CAPITAL MARKETS, a
division of First Tennessee Bank
National Association
By:
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Name: Xxxx Xxxxxx
Title: Senior Vice President
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above written.
FIRST HORIZON ASSET SECURITIES INC.
By:
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Name: Xxxxxx Xxxxx
Title: Vice President
FIRST HORIZON HOME LOAN CORPORATION
By:
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Name: Xxxxx XxXxx
Title: Executive Vice President
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